Gold (XAU/USD) is experiencing a sharp decline of nearly 2.5%, as rising oil prices, amid uncertainties surrounding the deal between the US and Iran, amplify inflation risks and support the strengthening of the dollar. Pressure on the precious metal is increasing due to rising energy costs and the Fed's hawkish stance, which is reducing investment demand. Overall sentiment in financial markets remains pessimistic.

US President Donald Trump once again warned Iran of the need to "take the negotiation process seriously," noting that Iranian representatives "behave differently": they seek an agreement behind closed doors but act cautiously in public. According to unconfirmed reports, Tehran is considering a 15-point proposal from Washington aimed at halting hostilities; however, it has not yet expressed a willingness to engage in active dialogue. Among the American demands are the export of highly enriched uranium stocks from the country, restrictions on its missile program, and a reduction in support for allied formations in the region.

Meanwhile, Axios reports that the Pentagon is preparing for a potential "final strike" against Iran, including the use of ground troops, adding to market nervousness and prompting investors to reassess risk assets.

An additional negative factor for gold is a Bloomberg report stating that the Central Bank of Turkey sold and exchanged around 60 tons of gold—worth over $8 billion—within two weeks of the onset of the Iranian conflict. Such actions have increased pressure on gold prices, prompting further profit-taking among investors.

Markets continue to factor in a scenario of high inflation and a persistent hawkish stance from the Fed. While at the beginning of the year traders expected at least two rate cuts, expectations have shifted significantly following the March 18 meeting and the sharp change in the geopolitical landscape. According to Prime Market Terminal data, market participants are now pricing in a probability of further tightening by the Fed of 12 basis points. As a result, the yield on 10-year US Treasury bonds rose by eight basis points to 4.412%, which decreases gold's appeal as a safe-haven asset.

Macroeconomic data from the US remains relatively stable: the number of initial jobless claims for the week ending March 21 was 210,000, matching analysts' forecasts and the previous figure of 205,000. This result confirms the strength of the labor market and provides the Fed with leeway to maintain a tough stance against inflation.

Further market focus is on upcoming speeches by Federal Reserve members—specifically, Lisa Cook, Stephen Miran, Philip Jefferson, Michael Barr, and Dallas Fed President Lorie Logan. Their comments may set the direction for the short-term dynamics of the dollar and interest-rate expectations, as well as for Trump's upcoming speech.

From a technical perspective, gold has changed direction after failing to break above the $4,550 mark or the 100-day SMA. Oscillators are negative, but it's important to note that the Relative Strength Index (RSI) is approaching the oversold zone, indicating a potential minor correction.

However, if the price of the yellow metal closes below the round $4,400 level, the next support level will be the Tuesday low, followed by the Monday low.

For upward movement, bulls need to overcome Wednesday's high to return to the $4,500 level.